Less than a week into President Donald Trump's trade war with China,
global automakers have shown there are ways to bypass the battle -- and
scoring a win for Beijing in the process.To get more
china auto news, you can visit shine news official website.
Tesla
Inc. and BMW AG are among the biggest potential losers from Beijing's
retaliatory tariffs on car imports from the U.S. because much of their
production is centered in America. They're now doubling down in China:
this week, Tesla announced its first factory outside the U.S. while BMW
is poised to become the first foreign manufacturer to own majority
control of a Chinese automobile venture. Cars made locally by foreign
brands will dodge import levies.
While those deals have taken
months -- if not longer -- to come together, the investments by
Munich-based BMW and Palo Alto, California-based Tesla back up Beijing's
claim to be continually opening up its economy and help rebut
allegations of protectionism by the Trump administration.
"China
is not backtracking, which is China's most clever response to the trade
war," said Alicia Garcia Herrero, chief Asia-Pacific economist at
Natixis SA in Hong Kong.
China and the U.S. imposed 25 percent
tariffs on $34 billion of the others' imports on July 6, and Beijing has
vowed to fight back against proposed tariffs on an additional $200
billion in Chinese goods in the tit-for-tat proposals between the
world's two largest economies.
It's against that background that Tesla announced its China plant.
"This
is not only an achievement of China's self-initiated opening up, it is
also an embodiment of win-win economic cooperation between China and the
U.S.," Gao Feng, a spokesman for the Ministry of Commerce in Beijing
said this week.Trump has criticized Harley-Davidson Inc. since the
motorcycle maker said it would move some production overseas as a result
of retaliatory levies by the European Union. Encouraging U.S. producers
like Tesla and BMW to increase domestic investment can be seen as a
notch in China's favor in the trade war.
BMW is set to be the
first foreign car company to take control of its Chinese enterprise
under an agreement between China and Germany, China's Foreign Ministry
said. The luxury automaker will soon reveal a new ownership structure of
its joint venture with Brilliance China Automotive Holdings Ltd.,
according to a person familiar with the plan.
No such deal with
the U.S. has been announced, although China plans to eventually scrap
the joint venture rule in the automotive industry by 2022.
Tesla,
the biggest name in electric cars, sealed a crucial agreement to build a
fully owned plant in China, only the company's second assembly line
anywhere in the world. The first car will be locally produced in about
two years, and the factory will eventually have an annual capacity of
500,000 cars.
The Wall